Greg Sargent rounds up some evidence today that the tide of public opinion is finally shifting on the debt ceiling. This doesn't surprise me. It's easy to casually say "hey, maybe we should just default and see what happens," as a friend of mine did on July 4th, but it gets a lot harder to say that when more and more people start speaking up and explaining exactly what would happen. For a while that wasn't happening because, as Stan Collender says:

On the one hand, much of Wall Street is insisting that the whole fight is political theater and that Congress and the White house will work something out. On the other hand, congressional Republicans are insisting that Wall Street won't react negatively if a deal doesn't get done. In other words, financial markets aren't yet reacting because they think a deal is in the offing and the GOP isn't cutting a deal because it doesn't think Wall Street cares.

Of course, that's not the only reason the GOP isn't cutting a deal. Jon Chait points today to an example of one of my pet peeves, the "politicians in Washington" dodge. When news outlets report that "the Senate" did something or that "politicians" are in denial, they mask who's really responsible. William Cohan did that today in a column about the debt ceiling fight, and Chait ain't happy about it:

It's not "the politicians in Washington" who don't understand the risks of failing to raise the debt ceiling. It's the Republican Party. It was the Republican Party's idea to turn the debt ceiling vote from a symbolic opportunity for the opposition party to posture against deficits into a high-stakes negotiation over budget policy. It's the Republican Party, and only the Republican Party, which has numerous elected officials dismissing the dangers of failing to lift the debt ceiling....The problem is that various reporters, pundits, and business types appear intent on blurring that reality. That's an important reason why Republicans are playing debt ceiling chicken.

But now Wall Street is finally reacting and (most) reporters are finally telling the story pretty straight: gambling with the debt ceiling is really dangerous and it's the GOP that has its fingers on the button. Put all this together, and even Republicans in the heartland are starting to figure out that screwing around with the financial integrity of the country is a little more serious than filibustering a judge or holding symbolic votes on abortion funding. As we get closer to August 2nd, and the consequences become even clearer, I expect the polls to continue shifting. After all, Armageddon only looks interesting from a distance.

The GOP practice, for the last twenty years or so, has been to play the "game" of politics in part by looking through the rule book for strategies that go beyond the norms of politics but are allowed under the literal reading of the rules. Examples include mid-decade redistricting, the recall of a California governor for no particular reason, and impeaching Bill Clinton. And, most notably, filibusters in the Senate as a routine measure. The idea is that in a normal, healthy, political system there's always going to be some gap between the written Constitutional and statutory rules on the one hand, and norms and practices on the other. A clever political party can gain occasional short-term advantages through exploiting that difference.

Sometimes this stuff can be clever: it was Newt Gingrich and his fellow rabble-rousers, for example, who discovered the power of late-night C-SPAN harangues in front of an empty chamber. There had never been any kind of rule against giving speeches when no one was around, it's just that no one ever did it. Gingrich figured out that C-SPAN made it a useful tool, and he was off to the races.

Other changes are more subtle than the items that Jonathan mentions. For example, the "blue slip" process for approving judicial nominees had been a pretty stable gentleman's agreement for a long time before Orrin Hatch decided that it could be changed unilaterally depending on which party held the White House. Likewise, Senate leaders had always tacitly agreed not to directly campaign against each other until Bill Frist decided to fly to South Dakota and take on Tom Daschle in 2004. Frist didn't break any rules, he just decided to break a longstanding norm. Ditto for something that everyone thought was a rule, but turned out to be a norm after all: the 15-minute time limit for votes in the House. Democrats broke this rule once under unusual circumstances in the 80s, and a decade later Republicans were breaking it routinely. That actually was a rule, but Tom DeLay and others figured out that a rule with no one to enforce it (and who can enforce this particular rule, after all?) could be broken with no ill consequences.

More recently, both judicial and executive appointments have been routinely held up just because they can be. Hell, Senate Republicans have now promised to block any nominee to head the Consumer Finance Protection Bureau just because they don't like the law and want it changed. And then there's the latest example: the debt ceiling fight. In the past, this was pretty well established kabuki: the minority party gives a few speeches about the recklessness of the majority, the president weighs in to say the U.S. has to honor its debts, and then the debt ceiling is raised. But once again, Republicans have figured out that old traditions are just that: traditions. There's no law that says you can't change them.

So where does this go from here? What's the next Capitol Hill norm that some bright young up-and-comer will figure out is just a norm — one that only naive schoolboys need to pay attention to? Beats me. But whatever it is, Republicans will find it. And our political system will grind ever closer to a complete halt.

Last night, in a post about allegations that Michele Bachmann suffers from migraine headaches that are "frequent" and "incapacitating," I said that this was a serious charge that required a serious response from the Bachmann campaign. A regular reader of mine also suffers from migraines, and he emails to say that it's not quite that simple:

I get them, and it's not such an easy thing to explain. Without medication, they knock me out as bad as they describe with Bachmann (although usually it's a day, not days). With medication, it's pretty manageable. The medication you take for an oncoming migraine (I take Relpax) is a miracle drug, and without it I probably couldn't manage in a job half as stressful as what I do. The preventative drugs I'm given are more of a crapshoot, that's just the unfortunate reality.

So like Bachmann, I'm on a shitload of drugs, and it's not an easy thing to explain; it's a lot of drugs and it's an everchanging regimen. I'm trying to taper off two of the drugs because a third seems to work better, and even when a preventative drug is no good, going off cold turkey induces more headaches. On top of it all, these drugs have primary uses for even more stigmatized medical conditions — two years ago my doctors talked me into taking one that's mainly for epilepsy, and not only did it not work, it put me in the hospital with an ulcer. Now one of the drugs I'm taking (but gradually trying to phase out) is mainly used for depression, something I didn't even know until I'd been on it for over a year.

So, needless to say, it's very easy to understand why she finds this hard to explain. For starters, the most effective thing is to be taking a lot of painkillers indefinitely, and that doesn't look good. Then you're on a boatload of preventative drugs that are also for things like epilepsy, depression, etc. No one really understands why the people who get these things at a severe level get them, or why it's different from a passing ache or pain. Plus, when you do get one that's not controlled, it's like someone flipped an off-switch on your body. In a situation where you don't have the luxury of lying down, you can power through on adrenaline, but you're still not the same person.

Look, I think you know that nothing is going to change my opinion that Michele Bachmann is a dangerous fruitcake. But this condition is very complicated and it doesn't sound like she's in any different pair of shoes than the many people — including many high performing professionals — who suffer from it. So, I guess this hits a nerve for me because this really is not evidence of her nature as a dangerous fruitcake, although it's easy for me to see how she will be unable to avoid that appearance. I think that ultimately this will do a lot of people who suffer from the same condition a disservice.

For the record, I don't think Bachmann's migraines have anything to do with her crazy ideas about how to run the country. But I do think that a condition that's potentially incapacitating during times of stress is very much an issue for a prospective president. We only learned after the fact about JFK's massive cocktail of medical problems, and it was probably just dumb luck that they never caused any serious problems. But it's not 1960 anymore. This might not be easy to explain, but it still needs to be explained. In a followup email, my correspondent agrees:

Of course it's relevant. Even if it had less of an impact than it does, running for President is an open-kimono exercise, so any desire to have some privacy around this is out the window. My fear though is that our very immature discourse combined with the still evolving courses of treatment could distort the depiction of this condition in two different directions: it's literally "in her head," because she's nutty; or it's so serious that it's disqualifying. My view as a sufferer is that it's all too real, but it's manageable like any other chronic health condition, like diabetes.

Matt Yglesias is startled by the chart below, which shows the greenhouse gas emissions produced by various kinds of food: "The carbon gap between lamb & beef on the one hand and pork & chicken on the other is larger than the gap between between pork & chicken and vegetarianism."

Two researchers at the University of Chicago estimated that switching to a vegan diet would have a bigger impact than trading in your gas guzzler for a Prius. A study out of Carnegie Mellon University found that the average American would do less for the planet by switching to a totally local diet than by going vegetarian one day a week....A Montanan who drives 40 miles to work might not have the option to take public transportation. But he or she can probably pull off a veggie stew.

This, of course, highlights the genius of the best answer to all of this: a carbon tax. If you tax carbon, nobody makes these decisions for you. You make them for yourself just by deciding what you want to spend your money on. If a carbon tax increases the price of carbon-intensive activities, some people will prefer giving up their hot rod to going without beef. Some will prefer eating more vegetables to giving up their SUV. Some will end up doing neither and giving up something else. But whatever it is, each individual will reduce his or her carbon use in the way that's the least personally onerous. No regulation can do that and no PR campaign can do that, but a price on carbon can. And in addition to all the awesomeness of letting the market work its magic to reduce carbon emissions with minimum pain and maximum consumer surplus, it also produces a pot of money that can be used to motivate research into better energy alternatives for everyone. We are almost literally insane for not doing this.

Spain has entered the danger zone for yield levels. The chart below shows the yield moves in the constant maturity 10y paper for the GIIPS countries. These markets traded a range between 6 per cent and 7 per cent but ultimately this proved to be a pause before the move to higher yields then accelerated. There is no consistent yield trigger level inside this range but market talk of point-of-no-return around the 6 ½% is not without foundation either.

....The conditions for a near death experience for the Euro are in place now, which in turn should finally galvanise a more serious policy reaction. In the interim, risk assets can be crushed.

This is not, repeat not, a good time to be screwing around with the possibility of defaulting on U.S. debt. Repeat: not, not, not. It's time for the Republican leadership to start facing reality and getting their troops in line. Playtime is over.

Worries about government debt rocked capital markets on both sides of the Atlantic Monday, as fears that the Greek crisis will spread combined with concerns at the standoff over the U.S. debt ceiling....Adding to the market woes were indications that, after months of shrugging off the debate over the U.S. debt ceiling, investors are getting edgy over Washington inaction ahead of an Aug. 2 deadline. The discomfort was reflected in the recent underperformance of the 30-year Treasury bond, traders and analysts said.

Hey, maybe investors are finally starting to understand that a big chunk of the Republican Party is really, truly batshit insane. They're not faking it! But here's a guess: all it will take to get the tea partiers in line is a thousand-point drop in the Dow. Suddenly, playing games won't seem like quite so much fun anymore, and it's about the only thing that seems to get their attention. I figure it should happen sometime around August 3rd or so.

The Minnesota Republican frequently suffers from stress-induced medical episodes that she has characterized as severe headaches. These episodes, say witnesses, occur once a week on average and can “incapacitate” her for days at time. On at least three occasions, Bachmann has landed in the hospital as a result.

“She has terrible migraine headaches. And they put her out of commission for a day or more at a time. They come out of nowhere, and they’re unpredictable,” says an adviser to Bachmann who was involved in her 2010 congressional campaign. “They level her. They put her down. It’s actually sad. It’s very painful.”...."When she gets ‘em, frankly, she can’t function at all. It’s not like a little thing with a couple Advils. It’s bad,” the adviser says. “The migraines are so bad and so intense, she carries and takes all sorts of pills. Prevention pills. Pills during the migraine. Pills after the migraine, to keep them under control. She has to take these pills wherever she goes.”

....Of particular concern to some around her is the significant amount of medication Bachmann takes to address her condition. The former aide says Bachmann’s congressional staff is “constantly” in contact with her doctors to tweak the types and amounts of medicine she is taking. Marcus Bachmann helps her manage the episodes.

I have no idea if this is really serious or not. Still, it sure sounds like something that deserves a more considered response from Bachmann's flack than an opaque statement that her headaches are "under control" and "I’m not going to go into her medical history.” If she wants to be president of the United States, her medical history is no longer something she can just blandly pretend is no one's business but hers. Just ask Thomas Eagleton.

Look, maybe this story is wrong or overblown. If so, Bachmann can explain and it becomes a non-story. But multiple members of her staff are claiming that this "random health issue" is something that happens frequently and is incapacitating when it occurs. If it's true, then yes, of course this matters in someone who wants to be president of the United States. I know we're all supposed to be disgusted by the media's relentless campaign preoccupation with minor personal issues, but sometimes these things actually matter.

All three credit rating agencies have now announced that they'll downgrade the United States if it fails to pass a debt limit increase and then defaults on its bond payments. Fitch is the latest:

The Fitch credit rating agency has warned that it could downgrade the nation's credit rating from AAA to B-plus as soon as Aug. 4 if a deal is not struck to raise the debt limit.

....First, the rating would be placed on Credit Watch Negative — a move already adopted by fellow rater Standard & Poor's. Two days after the deadline, the Treasury has a $90 billion bond due to mature. If the government does not pay in full that bond, Fitch would immediately knock the rating down several notches to B-plus — the highest possible rating for a nation in default.

God knows I don't want to downplay the urgency of all this, but WTF? Unless I'm missing something big here, defaulting on a bond payment is the last thing the government would do. There are a whole raft of other disastrous things (furloughs, Medicare payments delayed, Social Security checks reduced, etc. etc.) that would have to happen first, and even if they did, the Treasury Department probably has the constitutional right to do whatever it has to do to make debt payments anyway.

So what's going on here? Why the pretense that we might default on a bond payment on August 4? There's precisely zero chance of that happening no matter what Congress does.

Back in the 90s, if you'd asked me what my political persuasion was, I probably would have said I was sort of a neoliberal (in the American, Charlie Peters-ish sense of the word). My political leanings are liberal, but my temperament is technocratic and market oriented, and that made me a pretty good fit for the neoliberal team.

I got steadily off that bus over the years, partly because the whole neoliberal project was based on the assumption that moderation from Democrats would prompt similar moderation from Republicans that would eventually turn down the temperature of the culture wars and produce better overall governance. Needless to say, that's not quite what happened, something that Charlie Peters himself recognized and was unhappy about. More recently, though, I've moved even further away from the neoliberal persuasion because my nose has been rubbed a little too firmly in the fact that it simply doesn't work politically. The world is a messy place governed by messy interest groups and messy countervailing powers, and if you absent yourself from that world you'll get steamrolled. Henry Farrell discusses this today:

There is a real phenomenon that you might describe as left neo-liberalism in the US — liberals who came out of the experience of the 1980s convinced that the internal interest group dynamics of the Democratic party were a problem. These people came up with some interesting arguments (but also: Mickey Kaus), but seem to me to have always lacked a good theory of politics.

To be more precise — Neo-liberals tend to favor a combination of market mechanisms and technocratic solutions to solve social problems. But these kinds of solutions tend to discount politics — and in particular political collective action, which requires strong collective actors such as trade unions. This means that vaguely-leftish versions of neo-liberalism often have weak theories of politics, and in particular of the politics of collective action.

I see Doug [Henwood] and others as arguing that successful political change requires large scale organized collective action, and that this in turn requires the correction of major power imbalances (e.g. between labor and capital). They’re also arguing that neo-liberal policies at best tend not to help correct these imbalances, and they seem to me to have a pretty good case. Even if left-leaning neo-liberals are right to claim that technocratic solutions and market mechanisms can work to relieve disparities etc, it’s hard for me to see how left-leaning neo-liberalism can generate any self-sustaining politics.

This is a point I tried to make in different form a few months ago in "Plutocracy Now." Political change requires big, sustained institutional pressure, and in the past that came mainly (though not exclusively) from organized labor on the left and from the business community on the right. But organized labor is now all but dead as a motivating force in American politics, and this means that the nature of America's two main parties has been turned on its head. In the 70s, Republicans were in a certain amount of disarray, while Democrats were the party supposedly captured completely by interest group politics. Today, it's just the opposite: Republicans have been captured almost entirely by a coherent and mutually cooperative set of interest groups who know exactly what they want, while Democrats are at war with themselves, owing allegiance both to middle class interests and corporate funders, and unable to choose between them. Barack Obama is an almost perfect example of this tension, and it's the reason for his longstanding problems with the progressive wing of the Democratic Party.

In any case, it's pretty obvious which organizing principle has been more successful over the past couple of decades, and it hasn't been the liberal one. Put simply, the middle class simply doesn't have any kind of big, persistent, institutional representation in American politics any more, and that's left the field open for corporations and the rich to increasingly dominate economic policy. They know where their interests lie and they aren't afraid to fight for them.

Unfortunately, answers to this dilemma are thin on the ground, and Obama certainly hasn't figured out an answer. He's just trying to muddle through somehow. I don't know the answer either. But as I said a few months ago, "If the left ever wants to regain the vigor that powered earlier eras of liberal reform, it needs to rebuild the infrastructure of economic populism that we've ignored for too long. Figuring out how to do that is the central task of the new decade." It still is.